Saving money is one of the smartest financial moves you can make, but it’s also one of the hardest to stick with. In 2025, with inflation still hovering around 3% globally and interest rates fluctuating, many people find it challenging to grow their savings. Did you know that the average savings rate in the UK was just 5.9% in 2024, according to the Office for National Statistics? This means most people are saving less than 6% of their income, which is far below the 20% recommended by many financial experts.

 

Why is saving so difficult? The truth is, it’s not just about how much you earn but how much you keep. According to a 2023 study by the University of Cambridge, people who automate their savings are 30% more likely to reach their financial goals. Michael Hershfield, CEO of Accrue Savings, says, “Automating savings removes the temptation to spend and helps build wealth passively.” With so much at stake, what can you do to increase your savings rate without feeling deprived or overwhelmed? Let’s dive into eight practical, expert-backed savings tricks that anyone can use to boost their savings rate and secure a brighter financial future.

Table of Contents

1. Automate Your Savings: Pay Yourself First  
2. Choose High-Yield Savings Accounts  
3. Track Your Spending and Create a Budget  
4. Set Clear Financial Goals  
5. Reduce Debt to Free Up Cash  
6. Cut Unnecessary Expenses  
7. Start Investing Early  
8. Use Multiple Savings Accounts for Different Goals  
9. FAQs About Increasing Your Savings Rate  

 

1. Automate Your Savings: Pay Yourself First

Why Automation Works

 

The biggest hurdle to saving money is often human behavior. We tend to spend what we have and delay saving until “later,” which sometimes never comes. Automating your savings is a simple yet powerful trick to overcome this challenge. By setting up an automatic transfer from your checking account to your savings account every payday, you ensure that saving happens before you even see the money.

 

A 2023 survey by the National Bureau of Economic Research found that individuals who automated savings increased their savings rate by 20% on average compared to those who didn’t. This is because automation removes the decision-making process, which is often where people slip up.

 

How to Automate Your Savings

 

• Set a fixed percentage: Decide on a realistic amount, such as 10% of your monthly income.  

 

• Use your bank’s tools: Most banks offer automatic transfer options. Schedule transfers right after your paycheck arrives.  

 

• Treat savings like a bill: Just as you pay rent or utilities, treat your savings as a non-negotiable monthly expense.  

 

Expert Insight

 

Financial planner Suze Orman advises, “Automating your savings is like paying yourself first. It’s the best way to make sure you don’t spend what you don’t see.” This mindset shift is crucial for building consistent savings habits.

 

2. Choose High-Yield Savings Accounts

The Importance of Interest Rates

 

Putting your money in a regular savings account that offers a 0.41% interest rate (the average in 2025) means your money is growing very slowly, often not even keeping up with inflation. High-yield savings accounts, on the other hand, offer rates between 4% to 5% APY, which can significantly increase your savings over time.

 

Where to Find High-Yield Accounts

 

• Online banks: Institutions like Marcus by Goldman Sachs, Ally Bank, and Discover offer competitive high-yield savings accounts.  

 

• Credit unions: Often overlooked, credit unions can provide higher interest rates and lower fees.  

 

• Promotional offers: Some banks offer introductory rates that are much higher for the first six months to a year.

 

What to Watch Out For

 

• Fees: Ensure the account has no monthly maintenance fees.  

 

• Minimum balance requirements: Some accounts require a minimum balance to earn high interest.  

 

• Accessibility: Check how easy it is to access your money without penalties.

 

Research Insight

 

A 2024 study by the University of Oxford’s Saïd Business School found that savers who switched to high-yield accounts increased their savings balance by an average of 15% within one year, purely due to higher interest earnings.

 

3. Track Your Spending and Create a Budget

 

Why Budgeting Matters

You can’t improve what you don’t measure. Tracking your spending helps you understand where your money is going and identify areas to cut back. According to a 2023 survey by NerdWallet, people who track their expenses save 23% more annually than those who don’t.

 

How to Track Spending

 

• Use apps: Tools like Mint, YNAB (You Need A Budget), or PocketGuard automatically categorize expenses and provide spending insights.  

 

• Manual tracking: If you prefer, write down every expense daily or weekly in a notebook or spreadsheet.  

 

• Review monthly: Analyze your spending patterns and adjust your budget accordingly.

 

Creating a Budget That Works

 

• Set categories: Housing, food, transportation, entertainment, savings, etc.  

 

• Assign limits:  Based on your income and priorities, allocate realistic spending limits.  

 

• Include savings as a category:  Treat savings as a fixed monthly expense.

 

Expert Quote

 

Dave Ramsey, a personal finance guru, says, “A budget is telling your money where to go instead of wondering where it went.” This simple philosophy can transform your financial habits.

 

4. Set Clear Financial Goals

The Power of Goal-Setting

 

Having clear, specific financial goals makes saving more purposeful. Goals act as motivation and provide a roadmap for your savings journey. According to a 2022 study by Harvard Business School, people who set specific financial goals are 42% more likely to achieve them than those who don’t.

 

How to Set Effective Goals

 

• Be Specific: Instead of “save money,” say “save £5,000 for an emergency fund in 12 months.”  

 

• Break it down: Divide large goals into smaller monthly or weekly targets.  

 

• Make them measurable: Track progress regularly to stay motivated.

 

Types of Savings Goals

 

• Emergency fund: 3-6 months of living expenses.  

 

• Short-term goals: Vacation, new gadgets, home improvements.  

 

• Long-term goals: Retirement, buying a house, children’s education.

 

Expert Insight

 

Financial coach Farnoosh Torabi advises, “When you know why you’re saving, it’s easier to say no to impulse purchases and yes to your future.”

 

5. Reduce Debt to Free Up Cash

Why Debt Hurts Your Savings

 

High-interest debt, especially credit card debt, can quickly drain your finances. The average credit card interest rate in the UK is around 18.9%, meaning every £1,000 of debt costs you nearly £190 a year in interest alone. That’s money you could be saving or investing.

 

Strategies to Reduce Debt

 

• Debt snowball method: Pay off smallest debts first to build momentum.  

 

• Debt avalanche method: Pay off highest interest debts first to save money on interest.  

 

• Consolidation: Combine multiple debts into one with a lower interest rate.  

 

• Negotiate: Contact creditors to negotiate lower interest rates or payment plans.

 

How Debt Reduction Boosts Savings

By reducing debt, you free up money that was going toward interest payments. This extra cash can be redirected into your savings account, increasing your savings rate.

 

Expert Quote

 

Dave Ramsey says, “You can’t out-earn bad spending habits and debt. You have to out-save them.” Tackling debt is a crucial step toward financial freedom.

 

6. Cut Unnecessary Expenses

Small Cuts Add Up

 

It’s easy to overlook small daily expenses, but they add up to big savings over time. For example, skipping a £3 daily coffee saves over £1,000 a year. According to a 2024 report by the Money Advice Service, cutting just 10% of discretionary spending can boost your savings by hundreds annually.

 

Practical Ways to Cut Costs

 

• No-spend days:  Choose one or two days a week where you don’t spend any money.  

 

• Cancel unused subscriptions: Streaming services, gym memberships, or apps you rarely use.  

 

• Cook at home: Eating out costs 3-5 times more than home-cooked meals.  

 

• Shop smarter:Use coupons, buy in bulk, and compare prices.  

 

• Energy savings: Turn off lights, unplug devices, and use energy-efficient appliances.

 

Expert Insight

 

Personal finance expert Jean Chatzky says, “Small lifestyle changes can make a huge difference over time. It’s about being mindful, not miserable.”

 

7. Start Investing Early

Why Investing Matters

 

Saving money in a bank account is safe but often doesn’t keep pace with inflation. Investing allows your money to grow faster through compound interest. According to a 2023 study by the London School of Economics, individuals who start investing in their 20s accumulate 4 times more wealth by retirement than those who start in their 40s.

 

How to Start Investing

• Start small: Even £50 a month invested consistently can grow significantly.  

 

• Use tax-advantaged accounts: ISAs in the UK or 401(k)s in the US offer tax benefits.  

 

• Diversify: Spread investments across stocks, bonds, and mutual funds to reduce risk.  

 

• Seek advice: Consider robo-advisors or financial planners if you’re unsure.

 

Expert Quote

Warren Buffett famously said, “The best time to plant a tree was 20 years ago. The second best time is now.” The sooner you start investing, the better.

 

8. Use Multiple Savings Accounts for Different Goals

 

Why Separate Accounts Help

Keeping all your savings in one pot can be tempting to dip into for non-urgent expenses. Using separate accounts for different goals helps you stay organized and motivated. For example, have one account for emergencies, another for travel, and another for home improvements.

 

Benefits of Multiple Accounts

 

• Clearer tracking: See progress on each goal individually.  

 

• Reduced temptation:  Less likely to spend money earmarked for a specific purpose.  

 

• Better planning: Helps prioritize savings based on urgency and importance.

 

How to Manage Multiple Accounts

 

• Label accounts clearly: Use descriptive names like “Emergency Fund” or “Vacation 2026.”  

 

• Automate transfers: Allocate specific amounts to each account monthly.  

 

• Review goals regularly:  Adjust contributions as needed.

 

Expert Insight

 

Financial advisor Ramit Sethi advises, “Segmenting your savings psychologically reinforces your commitment to each goal.”

 

FAQs 

Q1: How much of my income should I save each month?  

A: Experts recommend saving at least 10-20% of your income. If that’s not possible right away, start small and increase your savings rate gradually.

 

Q2: What if I have debt and can’t save much?  

A: Focus on paying off high-interest debt first. Even saving a small emergency fund alongside debt payments is better than nothing.

 

Q3: Are high-yield savings accounts safe?  

A: Yes, as long as they are FDIC-insured (US) or FSCS-protected (UK), your money is safe up to a certain limit.

 

Q4: How can I save money during times of inflation?  

A: Cut discretionary spending, shop sales, use coupons, and consider fixed-rate bills or loans to protect against rising costs.

 

Q5: Can small daily savings really make a difference?  

A: Absolutely! Saving just £5 a day adds up to over £1,800 a year, especially when combined with interest or investment returns.

 

Final Thoughts: Your Savings Journey Starts Today

 

Increasing your savings rate is not about drastic sacrifices but smart, consistent habits. Whether it’s automating your savings, choosing the right accounts, or cutting small expenses, every step counts. Remember, as Benjamin Franklin said, “A penny saved is a penny earned.” So, what’s the first savings trick you’ll try today to boost your financial future?

 

References and Further Reading

 

– Office for National Statistics (ONS) – UK Savings Rate Data, 2024  

– National Bureau of Economic Research – Behavioral Finance Studies, 2023  

– University of Cambridge – Savings Automation Research, 2023  

– Harvard Business School – Goal-Setting and Financial Success, 2022  

– London School of Economics – Impact of Early Investing, 2023  

– Money Advice Service – Consumer Spending Report, 2024  

– Financial Times – High-Yield Savings Accounts Analysis, 2025  

– FDIC.gov – Savings Account Safety Information  

– NerdWallet – Budgeting and Savings Survey, 2023